BOK pledges to maintain price stability

During the year's first meeting of the Monetary Policy Committee, members reaffirmed their target for core inflation at between 2.5 percent and 3.5 percent.

"Real economic activities will remain sluggish in the first half but will begin a slow recovery in the second. Price levels are expected to remain stable but the abundant liquidity in circulation coupled with continued high oil prices could potentially apply pressure on the demand side," the BOK said in a statement.

The central bank will also "promote dialogue with the market and widen feedback channels in order to make its policy decisions more predictable."

"Amid the downward trend of home prices, households' demand for home financing will experience a limited increase. The corporate sector will likely increase facility investment but most of the costs will be covered by their internal funds," the report said.